What is PayPal?

If you're wondering what is PayPal, you're not alone. Learn more about this online payment service in this free lesson.

What is PayPal?

Paying for something online works a bit differently than it does in the real world. Without the option to pay with cash or check, you're usually limited to a credit or debit card. You may already be comfortable making these types of payments with a big online retailer like Amazon. But you might feel less comfortable doing so with a webpage you've never visited.

That's where PayPal comes in handy. It lets you make secure transactions without providing your credit card number to individual websites. Instead, you'll give your information to PayPal, which makes the payment on your behalf. Watch this video from PayPal to learn more about how it works.

Why use PayPal?

PayPal was one of the first online payment systems, and it's generally seen as one of the most trustworthy. As a result, you can use it to make payments to many online stores, including eBay, Etsy, Overstock, and a whole lot more. PayPal is also an easy way to send money to a friend or family member, as long as you both have a PayPal account.

Does this cost anything?

If you're using PayPal to make a purchase from an online store, it's totally free to use. However, you may have to pay a small service fee to use PayPal to transfer funds to another person. You can review this page from PayPal to learn more about its fee structure.

You'll need to provide some type of payment option for PayPal to use. We recommend only linking a credit card here. This way, you can dispute any unauthorized charges with your credit card company, in addition to PayPal's own dispute resolution options.

That's it! You can now use your PayPal account to make payments online. Just look for for a PayPal option at checkout, sign in to your account, and confirm the transaction.